The owner of renowned Glasgow tavern The Horseshoe Bar is continuing to grow sales ahead of the market despite the impact on trade caused by this summer's riots in England and Northern Ireland.

Mitchells & Butlers manages more than 1,700 restaurants and pubs across the UK including well-known chains such as All Bar One, Harvester and Toby Carvery. In a trading statement covering the financial year to September 21, the company said it continues to anticipate annual results at the top end of expectations even though sales have been decelerating.

Revenue growth dropped to 2.5% in the final three months of the year, maintaining the slowdown from growth of 7.7%, 6.1% and 3.4% per cent in the first, second and third quarters respectively. All brands were said to be in growth, with the annual figure averaging out at 5.2%.

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"The rate of growth in the fourth quarter continues to reflect a progressive easing of the inflationary environment, as well as an unseasonally cool and wet summer period and the disruption caused by riots in city centres during August," the company noted.

Net cost headwinds fell to £55 million despite a sharp rise in labour costs, which have been "substantially mitigated by deflation in our energy costs, but also slowing food cost inflation and strong cost control at site level".

Mitchells & Butlers continued to focus on investment in its estate during the past year, completing 185 conversion and remodelling projects while also opening six new sites. The group also continues to roll out the use of solar panels and sensors to reduce its energy usage.

"Sales growth has continued to normalise as inflationary cost pressures ease whilst our diverse portfolio of established brands and advantaged estate locations underpin our outperformance against the market," chief executive Phil Urban said.

"We enter the new financial year armed with a fresh wave of initiatives under our Ignite programme and a full capital investment programme planned to deliver cost efficiencies, increased sales and to further drive market out-performance and increasing profitability."

Analyst Greg Johnson of Shore Capital said the positive trading update and "excellent" profit conversion has led him to upgrade his 2024 operating profit forecast by around 4% to £302m. Adam Vettese of eToro said although growth has slowed, this still compares favourably to the industry as a whole.

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Derren Nathan, head of equity research at Hargreaves Lansdown, agreed: "The group has been consistently outperforming the market and it's not taking its eye off the ball, continuing to prioritise investment in the estate when it comes to the use of cash.

"With 50 pubs a month closing in the first half of 2024 in England and Wales, solid operators like Mitchells & Butlers are well placed to keep mopping up market share."

The Horseshoe Bar opened at its current site in Glasgow's Drury Street in 1846 when local spirits dealer William Turnbull moved into the premises. It became known as The Horseshoe Bar in 1884 when it was taken over by John Scoullar, who changed it in keeping with the equine names of his other bars.

The pub, which claims to have the longest bar in Europe of 104 feet and three inches, was taken over by Birmingham-based Mitchells & Butlers in 2007. 

When the new owners decided to get rid of the famous "pie and a pint" which had appeared on the pub's menu for generations, some 65,000 Glaswegians signed a petition demanding its return. The pie and a pint was back on the menu within a week.

Shares in Mitchells & Butlers closed yesterday's trading 7.5p higher at 304.5p.